Brazil cuts payroll taxes in industry, service sectors

Rio de Janeiro, April 4: Brazilian President Dilma Rousseff has enacted a bill to lower payroll taxes for the industry and service sectors.

The measure, designed to stimulate the economy and encourage companies to hire more workers, relieves certain companies from paying 20 percent payroll taxes to the government, reported Xinhua.

Rousseff partially vetoed the original bill, which called for payroll tax cuts in 33 sectors of the economy, saying lower payroll taxes in several sectors would lead to violations of the fiscal responsibility rules, since there were no estimates on the bill’s impact in those sectors.

Among the sectors vetoed by the president are media companies, airport, railway and subway companies, hospital services, and engineering companies.

The payroll tax cuts are the latest in a series of measures promoted by the Brazilian government to stimulate the economy, which registered a low growth rate of 0.9 percent last year.

Despite the stimulus packages, the Brazilian economy remains in a fragile recovery.

IANS